An end to overtime? U.S. House passes a bill letting employers offer ‘comp’ time instead of paying overtime

A bill that passed the U.S. House of Representatives on May 2 would allow employers to offer “comp time” instead of paying overtime. HR 1180, the “Working Families Flexibility Act of 2017,” would undermine the federal overtime protection that has been in place since 1938. House Workforce Committee Chair Bradley Byrne (R-Ala.) called the 1938 Fair Labor Standards Act (FLSA) an “antiquated federal law” in a hearing on HR 1180. FLSA is the law that sets the federal minimum wage and requires employers to pay time-and-a-half to hourly workers when they work more than 40 hours a week.

The point of the FLSA’s overtime provision is to discourage long hours — by making it more expensive for the employer to schedule them. HR 1180 would undo that disincentive, because the employer could offer the paid time off at the regular hourly rate instead of paying the time-and-a-half rate. Not only that, but the paid time off would come at the employer’s discretion up to a year later. It would amount to an interest-free loan by the worker to the employer, because the worker wouldn’t be paid anything for the hours until the comp time is used. Rep. Suzanne Bonamici (D-Ore.) tried unsuccessfully to amend the bill by requiring that employers keep employees’ comp time pay in an interest-bearing account.

HR 1180 says workers could accrue up to 160 hours of comp time; any not used by end of a year would have to be cashed out at the time-and-a-half rate within a month.

The bill says employees would have to agree to the comp time swap. But the bill’s critics say given the power differential, many nonunion workers would feel compelled to accept comp time.

When it reached the House floor, it passed 229-197. Not a single Democrat voted for the bill, and six Republicans joined the Democrats in voting “no.” A companion bill, S.801, is now in the Senate Health, Education, Labor, and Pensions Committee. The White House in a statement said President Trump would sign the bill if it reaches his desk.

MORE:

“An Invitation to Wage Theft” — The New York Times editorial against HR 1180

U.S. Rep. Suzanne Bonamici (D-Ore.) speaks against HR 1180 on the House floor before the vote.